US slaps duties on Chinese steel
By Alan Rappeport in Washington
FT Published: December 30 2009 18:03 | Last updated: December 30 2009 18:19
The federal US body arbitrating trade disputes on Wednesday imposed tough new duties on Chinese steel piping imports in a move that will heighten tension between America and its biggest trading partner and emerging geopolitical rival.
With $2.8bn in Chinese piping imports in 2008, the case is the biggest against China brought before the International Trade Commission to date. It follows a string of actions by the US to counter a flood of that it claims China exports at below market prices.
The ITC’s ruling will slap Chinese companies with additional taxes ranging from 10 to 16 per cent and backs an earlier claim from the commerce department that argued the US steel industry was being harmed by Chinese dumping. The US government has been under intense pressure to protect domestic industries in an effort to stem the flow of job losses.
While the Chinese have been eating our lunch, this ruling doesn't them to have our dinner also, said Tom Danjczek, president of the US Steel Manufacturers Association.
Arlen Specter, senator from Pennsylvania, testified to the ITC that the lost jobs and plant shutdowns from China’s dumping represent the most severe and intolerable harm from unfair trade.
According to Mr Danjczek, China’s trade practices have cut US steel pipe and tube production by 40 per cent in the last year and cost the industry thousands of jobs.
Steel piping is widely used by the oil industry for drilling and was in great demand last year when oil prices surged. The commerce department estimated that between 2006 and 2008 Chinese pipe imports surged 203 per cent.
In November the commerce department imposed separate anti-dumping duties of up to 99 per cent on imports of some Chinese pipes.
Daniel Porter, a lawyer representing 11 of China’s largest steel pipe exporters, said Wednesday’s decision was not fair because US steel pipe producers recorded record profits in 2008 but could not keep up with demand, which fell along with oil prices this year.
Demand collapsed, but that’s not the fault of the Chinese, Mr Porter said.
Friction between the US and China has been building this year after over tariffs on tyres, cars and chickens. Earlier this month, China levied duties on US specialty steel products that it said were being subsidised through the Buy American legislation.
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